Mortgage refinance demand spikes nearly 60%

👔 Thanks for joining us this Wednesday. Federal Reserve day is upon us and traders largely expect a quarter-point cut in interest rates. Today’s newsletter is a 2-minute read.

1. Mortgage refinance demand spikes nearly 60%, as interest rates drop sharply

Mortgage rates last week dropped to the lowest level since October of last year. That caused a massive run on refinances, as consumers seek more savings in an uncertain economy.

• Applications to refinance a home loan jumped 58% last week compared with the previous week and were 70% higher than the same week one year ago.

• The refinance share of mortgage activity increased to 59.8% of total applications from 48.8% the previous week.

• The average interest rate for 30-year fixed-rate mortgages decreased to 6.39% from 6.49%.

2. Builder confidence steady but future sales expectations hit six-month high

Builder confidence remained low in September, with the NAHB/Wells Fargo Housing Market Index steady at 32, but expectations for future sales improved on the prospect of Federal Reserve rate cuts.

While 39% of builders reported cutting prices and 65% offered incentives—the highest post-COVID levels—declining mortgage rates, now averaging 6.35%, are seen as a positive for demand.

The HMI’s future sales component rose to 45, its highest since March, though current sales held at 34 and buyer traffic slipped to 21. Regionally, sentiment was unchanged in the Northeast (44) and South (29) and edged up in the Midwest (42) and West (26)

Stay Connected to Your Clients and Build Lasting Relationships with our Marketing Solutions

Maintaining and growing relationships in the mortgage industry is one of our biggest challenges. Studies show that within a year, most homebuyers don’t remember their LO’s name.

That’s why Cotality developed Araya – your single source for Intelligent Marketing Solutions. With our easy-to-use, intuitive platform, you can easily leverage our five powerful solutions to:

• Keep in touch with past customers with personalized, automated messaging

• Know when they are in market for a new home or other lending product

• Build high-quality lead lists tailored to your specific campaign goals.

• Uncover new areas of opportunity and identify potential networking partners

• Get detailed property-level information on over 99.9% of U.S. residential properties

To see more about how we’re helping originators succeed in any market, check out our comprehensive suite of solutions and schedule a demo with us today!

3. More Nuggets

🚨 Ex-NASA employee and husband convicted of mortgage fraud. (DOJ)

💼 Trump pick Stephen Miran confirmed as Federal Reserve governor. (CNN)

📈 Foreclosure filings rise 18% year over year in August. (ATTOM)

⏹️ Federal court blocks Trump from sacking Lisa Cook. (BankingDive)

4. UHM acquires assets of Sierra Pacific Mortgage

Union Home Mortgage (UHM) has agreed to acquire the assets of Sierra Pacific Mortgage, sources told HousingWire. The deal is UHM’s second this year, following its March purchase of Nations Reliable Lending.

Sierra Pacific originated about $1 billion over the past year, while UHM produced $5.5 billion. The acquisition expands UHM’s reach, adding Sierra Pacific’s stronger presence in California, Kansas, and Tennessee to UHM’s core markets in Ohio, Michigan, Texas, and Florida.

Sierra Pacific has 149 loan officers and 42 branches compared with UHM’s 834 loan officers and 217 branches. A source said the deal led to the elimination of Sierra Pacific’s post-closing department.

5. Judge allows appraisal bias lawsuit against Rocket to proceed

A Colorado federal judge has allowed an appraisal bias lawsuit against Rocket Mortgage to proceed, denying the company’s motion to dismiss.

The Department of Justice and HUD filed the case in 2024 against Rocket, appraiser Maksym Mykhailyna, his firm Maverick Appraisal Group, and appraisal management company Solidifi.

The suit alleges a Black homeowner’s property in Denver was undervalued by more than $200,000 due to racial bias, and that Rocket canceled her refinance application after she reported the issue.

In a statement, a spokesperson for the lender wrote, “Despite the judge’s ruling, Rocket Mortgage remains steadfast that it did not discriminate in any way.”

☀️ You’re all caught up. See you on Friday!

🚀 Wanna help our newsletter grow? Forward it to a friend or colleague.

Would you like to receive a ready-to-send weekly marketing email for your realtors and/or clients? Start your 30-day free trial here.

Was this email forwarded to you? Subscribe here.

Interested in advertising to 40k+ loan officers? Get in touch.